Procedures pursuant to Sections 104 and 105 of the Canada Transportation Act
Office of the Registrar General of Canada

Policy Statement 16.1
February 29, 2008

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Table of Contents

• Introduction
• Relevant Sections of the CTA
  • Section 104
  • Section 105
• Procedures for Deposits under Both Sections 104 and 105 of the CTA
  • The Registrar's Office
  • Registration
  • Manner of Registration
  • Letter of Transmittal
  • Proof of Filing
  • Effective Date
  • Signature Date
  • Filing Fees
  • Registration Copies
  • File Maintenance
  • Memoranda or Summary Filings
  • Collateral Descriptions
  • Intentional Deletion of Information
  • Review and Deficiencies
  • Procedures for Searching
  • Additional Information and How to reach the Registrar General of Canada
• Annex 1: Commonly Asked Questions

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Introduction

These procedures are intended for use by corporations, railway companies, law firms and other professional advisors who make deposits pursuant to sections 104 and 105 of the Canada Transportation Act (referred to throughout this document as the CTA) with the Office of the Registrar General of Canada (referred to throughout this document as the Registrar). Section 104 of the CTA allows for the registration of mortgages and hypothecs. Section 105 of the CTA allows for registration of certain contracts respecting rolling stock.

These procedures have been formulated to both assist in ease of filing and, in the interests of fairness, to ensure the consistent application of rules and procedures by the Registrar's staff. Unless otherwise indicated, they do not have the force of law. In issuing these procedures, the Registrar does not express any legal opinions or offer any interpretation in respect of the legislation. You may wish to consult with legal counsel or other professional advisers to consider other features that might be desirable in your application. The final interpretation of the CTA is the function of the courts.

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Relevant Sections of the CTA

Section 104:

1. The following may, in accordance with the regulations, be deposited by any person in the office of the Registrar General of Canada or in any other place that the Governor in Council may, by order, specify:
   1. a mortgage or hypothec issued by a railway company;
   2. a security agreement entered into by a railway company;
   3. an assignment or other document affecting a document referred to in paragraph (a) or
   4. a copy of any document referred to in any of paragraphs (a) to (c) or a summary of any such document made in accordance with regulations made under section 105.1.
2. Once the deposit is made, the mortgage or hypothec, security agreement, assignment or other document need not be deposited, registered or filed under any other law or statute respecting real or personal property, and the deposited document is valid against all persons.

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Section 105:

1. A document, or a copy or summary of a document, evidencing any of the following transactions may, in accordance with the regulations, be deposited by any person in the office of the Registrar General of Canada or in any other place that the Governor in Council may, by order, specify:
   1. a lease, sale, conditional sale, instalment sale, mortgage, hypothec, bailment, leasing, deposit or security agreement relating to rolling stock or any accessories or appurtenances relating to rolling stock; and
   2. an amendment, assignment or discharge of a document mentioned in paragraph (a).
2. [Repealed, 2007, c. 19, s. 31]
3. Once the deposit is made, the document need not be deposited, registered or filed under any other law or statute respecting real or personal property, and the document is valid against all persons.
4. [Repealed, 2007, c. 19, s. 31]

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Procedures for Deposits under Both Sections 104 and 105 of the CTA

The Registrar's Office

Deposits under sections 104 and 105 of the CTA are currently made with the Registrar. The Minister of Industry, has, by statute, been designated as the Registrar. The functions of the Registrar are currently carried out by Corporations Canada, a branch of Industry Canada.

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Registration

Registration may be effected in person or by courier, mail or fax. When documents are sent by fax, the original document must be received by the Registrar within five business days.

Although deposit by fax is accepted, the Registrar encourages the avoidance of faxing documents if possible, particularly if the length of the documents may make the process burdensome. Deposits cannot be filed on-line or by e-mail.

Documents for registration may be sent to:

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Manner of Registration

Corporations Canada's reception is open from Monday to Friday, between 9:00 a.m. to 12:00 p.m. and 1:00 p.m. to 5:00 p.m. Each document presented for deposit under either section 104 or 105 of the CTA will be given a time and date of deposit. Documents will be deemed to be deposited on the date and time of actual receipt by Corporations Canada.

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Letter of Transmittal

Every document or batch of documents presented for registration shall be accompanied by a letter of transmittal addressed to the Registrar indicating under which section, either section 104 or 105 of the CTA, the documents are to be registered. Filings which either lack a letter of transmittal or include a letter of transmittal which does not clearly indicate the precise section under which the documents are to be registered, will be considered deficient. Beyond the requirement to indicate the relevant statutory section, the form of the letter of transmittal is not prescribed.

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Proof of Filing

Following receipt of the documents, the Registrar will issue a letter (referred to as an acknowledgement letter) to the party which signed the letter of transmittal approximately five working days following the date the documents are received by the Registrar. Included with the acknowledgement letter will be duplicate copies of the deposited documents bearing the stamp of the Registrar on each page that has a signature. Filers who have a regularly scheduled courier pick-up with Corporations Canada may request that their acknowledgement letter be left in the courier system. Filers who do not have such service will receive their acknowledgement letter by regular mail.

The acknowledgement letter will recite the documents deposited including the names of each of the deposits, the parties thereto, the section of the CTA under which the deposit was made, the effective dates of each of the deposits, the date of registration of each deposit as well as confirmation of payment of the filing fee.

Any errors in the contents of the acknowledgement letter should be brought to the attention of the Registrar immediately on its receipt by the filer.

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Effective Date

Documents presented for deposit may bear any effective date. The Registrar requests that the effective date be clearly stated in the first paragraph of every document presented for deposit or otherwise on the face of the document. Documents that bear an effective date after the date of delivery to Corporations Canada will be accepted for registration.

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Signature Date

Documents deposited under section 104 or 105 of the CTA are not subject to any timing restrictions and will therefore be accepted for deposit at any time following signature. Only signed documents will be accepted for registration.

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Filing Fees

For the deposit of each primary document	100$
For each secondary document filed at the same time as the primary document	35$
Where secondary documents are filed on a subsequent date to the primary document:
the first secondary document	100$
all subsequent secondary documents filed that day	35$
Each additional copy of the registered document, beyond the copy that accompanies the acknowledgment letter	35$

Please note that the letter of transmittal should clearly state whether documents are primary or secondary in nature to ensure that proper fees are charged. A primary document is the first of a series of documents involved in a transaction or a relationship. A secondary document is either a document which is related to the primary document because it is part of the same transaction or because it is an amendment, assignment, release or discharge of same.

The filing fee may be paid:

1. in cash;
2. by cheque, in Canadian dollars, payable to the Receiver General for Canada,
3. by credit card (American Express®, MasterCard® or Visa®);
4. or by deposit to an account opened with Industry Canada.

In the letter of transmittal, please indicate the method of payment and if the payment is made by credit card, please provide the name of the credit card holder, credit card number and its expiry date.

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Registration Copies

The Registrar asks that deposits under either section 104 or 105 of the CTA be made in duplicate. At least one copy of each document msut be an original; the duplicate may, however, be a copy. The original will be scanned by the Registrar. The original will be kept by National Archives of Canada. However, the duplicate will be stamped and returned to the filer. If only one copy of a document is presented for registration, the original will not be copied and returned to the client. No stamped duplicate will be sent with the acknowledgment letter.

The Registrar does not prescribe the format of documents for deposit, provided that all documents presented for deposit are legible and suitable for scanning by an optical character reader. Because the scanning equipment used to read documents into the Registrar's database is unable to recognize handwriting, all documents, with the exception of executions, must be typewritten. Documents presented for deposit with an undue amount of handwriting will be considered deficient.

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File Maintenance

Deposits under sections 104 and section 105 of the CTA will be permanently maintained in the Registrar's database, even if a letter of transmittal or a deposit itself expressly indicates such deposit has a fixed term and/or where a discharge or release of a deposit is subsequently filed in respect of such deposit. Furthermore, the registrar will not grant any requests to remove a deposit from the system.

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Memoranda or Summary Filings

In respect of section 104 filings, the full text of the mortgage, hypothec, assignment or related document must be filed with the Registrar. However, subsection 105(2) of the CTA allows a summary (also referred to as a memorandum) of a document to be filed in place of the actual document or a copy thereof. The contents of the summary or memorandum are to be prescribed by regulations. While there are no regulations under subsection 105(2), the Registrar suggests that a memorandum or summary filing cover the following points:

1. the effective date of the memorandum or summary must be clearly visible on the face of the memorandum or summary;
2. the nature of the document in reference to the criteria set out in section 105 of the CTA must be explained (the memorandum or summary should therefore indicate whether the original document evidenced a lease, a sale, a conditional sale, a mortgage, a bailment or an amendment, assignment or discharge of one of these interests);
3. the memorandum or summary must be referred to using the name of the original document (for example, a memorandum evidencing Lease Assignment Trust-ABC must be entitled, "Memorandum of Lease Assignment Trust-ABC");
4. he memorandum or summary must identify all the parties to the document it summarizes;
5. the effective date of the document that is summarized by the memorandum or summary must be clearly stated in the body of the memorandum or summary;
6. collateral descriptions in the original document must be expressly repeated in the memorandum or summary;
7. any other documents on deposit with the Registrar to which the memorandum or summary refers must be clearly identified by time and date of deposit;
8. the memorandum or summary must clearly refer to the terms of the document and incorporate the terms thereof by reference;
9. the memorandum or summary must be properly executed by all parties to such document.

All parties submitting filings must ensure their own compliance with these provisions. The Registrar's review of memorandum or summary filings will not include a review of these items though a memorandum or summary filing lacking these items will be considered deficient.

The date of execution of a memorandum or summary filing does not have to be the same as the effective date or the date of execution of the document which it summarizes. Memorandum or summary filings are often executed in advance of the execution of the documents they summarize. This practice is acceptable to the Registrar if the memorandum or summary filing refers specifically to the document it summarizes by date.

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Collateral Descriptions

All documents presented for deposit must clearly describe the general collateral in respect of a section 104 of the CTA filing or the rolling stock in respect of a section 105 of the CTA filing. Secondary documents filed under either section that do not either enumerate rolling stock or recite the collateral must clearly refer back to the collateral or rolling stock listed in the primary document and identify such document by effective date, date of deposit and names of the parties.

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Intentional Deletion of Information

Because section 105 of the CTA requires deposit of evidence only, information may be deleted from deposits made thereunder provided the information which is deleted is replaced by the words, "Intentionally Deleted" or words to a similar effect. However, deposits made under section 104 of the CTA must include full texts of the document.

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Review and Deficiencies

No preliminary review of documents will be conducted prior to the deposit. The Registrar will review all documents for certain formal requirements prior to release of the acknowledgement letter. These formal requirements which the Registrar reviews are as follows:

1. signature by all parties;
2. clear evidence of effective date of document on face of document;
3. clear description of collateral or rolling stock; and
4. clear instruction in letter of transmittal to deposit under either section 104 or 105 of the CTA. The Registrar will briefly review the information to ensure it is filed under the appropriate section.

Documents which do not comply with the statutory requirements or these procedures will be rejected. As a courtesy, the Registrar will contact the party who signed the letter of transmittal by telephone to advise him/her of any deficiency. If the deficiency can be explained or remedied, the Registrar, again as a courtesy, will maintain the documents provided such deficiency is remedied within 5 business days. Upon correction of the deficiency, the documents will be deemed to be deposited on the date and time originally deposited.

All decisions of the Registrar are final. Parties who wish to appeal a decision of the Registrar should submit their comments in writing to the Deputy Minister or the Minister of Industry at 235 Queen Street, Ottawa, Ontario K1A 0H5. Prior to formally appealing a decision of the Registrar, you may wish to have the matter reviewed by the Director General of Corporations Canada by writing to:

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Procedures for searching

Because the deposit system under both sections 104 and 105 of the CTA is intended to provide notice to interested parties, searches are often conducted to review deposits. All interested parties must conduct their own searches and no telephone or other verbal confirmations of deposits will be provided by the Registrar. The Registrar does not warrant the legal validity of any deposit made with the Registrar under the CTA.

While the Registrar's staff is always available to answer questions and assist users of the deposit system, searches under sections 104 and 105 of the CTA must be conducted by the users themselves. The Registrar's staff will not conduct any searches, subsearches or file enquiries.

Searches must be conducted at the Corporations Canada reception area. No appointment is required. Three computer terminals are available to conduct searches of the deposit database. A comprehensive user manual is available for all individuals conducting searches.

The Registrar does not warrant the accuracy or completeness of the deposit system. As a result, searches are conducted at the risk of the user and no insurance or compensation scheme is maintained in respect of damages occasioned by reliance on such searches. All users of the deposit system are deemed to use the system at their own risk and are further deemed to waive any claims or other rights of action they may have in respect of reliance on such system. Every individual conducting a search is subject to the following express warning:

The records maintained by the Registrar have not been merged to reflect various amalgamations of railway companies and other transactions involving successors in title and changes of corporate name. As a result, if a party, whether it be a company or railway company, has amalgamated or another corporate transaction has occurred and a name change resulted, parties conducting searches may want to consider searching the files of all predecessor companies and/or former corporate names of any existing companies.

A log of documents received by Registration staff but not yet scanned into the system is maintained by the Registrar. Once a document is scanned, no access to the paper files will be permitted at any time.

There is no charge for conducting searches under either section 104 or 105 of the CTA.

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Additional Information and How to reach the Registrar General of Canada

For additional information, please contact the Registrar General of Canada at 613-941-9053.

Enquiries may also be directed generally to Corporations Canada at 1-866-333-5556 if no member of the Registrar's staff is available.

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Annex 1: Commonly-asked questions

The following is a collection of commonly-asked questions put to the Registrar's staff. It is hoped that the clarification, albeit limited, provided in these procedures, will offer some assistance to users of the systems. However, these Procedures do not have the force of law and the Registrar does not express any legal opinions or offer any definitive interpretation in respect of the legislation.

1. Does registration of a document under section 104 or section 105 of the CTA ensure the validity of such a document under the relevant section?

By accepting a deposit under section 104 or section 105 of the CTA, the Registrar does not provide any opinion on the substantive validity of such document. As a result, acceptance and registration by the Registrar of a document pursuant to section 104 of the CTA does not ensure that it is a mortgage or hypothec for the purposes of the statute. Similarly, acceptance and registration of a deposit under section 105 of the CTA does not ensure that the instrument evidences a lease, sale, conditional sale, mortgage, hypothec, bailment or security agreement relating to rolling stock. The Registrar simply reviews the formal elements of a deposit and accepts the document for registration.

2. What is the difference between a section 104 filing and a section 105 filing under the CTA?

Section 104 of the CTA allows for the registration of mortgages, hypothecs or other related documents. By contrast, section 105 of the CTA refers not to a document but to a type of transaction, namely a lease, sale, conditional sale, mortgage, hypothec, bailment or security agreement relating to rolling stock. It is requested that all letters of transmittal clearly direct the Registrar to deposit the documents under a particular section.

3. Does registration under section 104 or section 105 of the CTA, as the case may be, alleviate the need for provincial registration?

Registration pursuant to section 104 of the CTA and section 105 of the CTA, as the case may be, appears to make registration at the provincial level unnecessary.⁽¹⁾ The language of both seems to obviate the need for provincial filing. Filing exclusively at the federal level is entirely at the discretion of the user.

4. Does registration under section 104 or 105 of the CTA establish a system of priorities?

The Registrar is unable to express any legal opinion on this point. Notable, however, is the difference in language between section 104 of the CTA, which is silent in respect of third parties, and section 105 of the CTA, which indicates that, on due execution and deposit, documents deposited thereunder are "valid against all persons."

5. Is the nature of the deposit system a title system or a notice system?

It appears from the language of section 104 of the CTA that the deposit system maintained thereunder is not intended to be a title system but rather a system providing notice to third parties in respect of mortgages and hypothecs. No scope appears to be provided in the legislation for registering documents of title. Section 105 of the CTA, however, appears to contemplate registrations in respect of title including instruments evidencing sales and conditional sales. Notably, the language in section 105 of the CTA referring to a "sale" or "mortgage" was introduced into the statute in amendments in 1980 presumably to bring the statute more closely in line with the provisions of the U.S. Interstate Commerce Act, but the Registrar notes that the filing system does not provide an index or other features of a title system.

6. If a document is registered pursuant to the U.S. Interstate Commerce Act, does it also have to be filed under section 105 of the CTA?

Yes. Section 11301 of Title 49 of the United States Code (formerly section 20c of the Interstate Commerce Act) is the American equivalent of section 105 of the CTA. The Registrar understands that the American statute gives effect to deposits made under the CTA, but the CTA does not have a reciprocal provision. The Registrar is, however, mindful of the provisions for filing under the American system, and the Registrar's procedures permit deposit of memoranda and summaries consistent with practice under that system.

7. What does the definition of rolling stock include?

Rolling stock is defined in section 6 of the CTA:

8. Does an index system exist in respect of section 105 of the CTA deposits similar to that maintained by the Surface Transportation Board in the United States?

The database does not provide an index such as exists pursuant to the U.S. Interstate Commerce Act. Documents are simply scanned into the system and searching is conducted based on fields. Documents, including primary documents and secondary documents, are not cross-referenced even if they are filed as a "batch" on the same day. Letters of transmittal are not scanned into the database. Where documents are filed and relate to documentation filed on a previous date, the Registrar will, based on instructions in a letter of transmittal, make a notation in the comments fields of each document header/banner cross-referencing the document back to a pre-existing document in the system where the precise document number of that deposit is specified by the client in the letter of transmittal.

9. Does the depositor have to publish a notice of deposit in the Canada Gazette for the deposit be effective?

Following amendments to the CTA that came into force June 22, 2007, a notice in the Canada Gazette is no longer required.

10. Will the Registrar, on request, provide a letter or report to provincial land registry authorities in respect of outstanding registrations under section 104 of the CTA?

The Registrar's staff will not conduct any searches, subsearches or file enquiries and, as a result, is unable to provide any information, whether certified or uncertified, to provincial real or personal property registries or any other person.

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1. Consider the comments in The Canadian Railway Act, 1919 by Angus MacMurchy and John Spence (Toronto: Canada Law Book Company, Limited, 1922) at p. 160:

"This [section 138, now embodied in section 104 of the CTA] and the preceding section [now also part of section 104 of the CTA[ are no doubt intended to provide a uniform method of registration for all mortgages of the real or personal property of railways which are subject to the jurisdiction of the Federal Government in place of the diverse laws upon that subject which exist in each of the provinces." Return to (1)

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